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Overdrive February 2019

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Overdrive
| February 2019
T
he independent contractor classification last year took what
some see as an uppercut to the chin in the California high
court case of Dynamex v. Superior Court of Los Angeles. The
court used what's commonly known as the "ABC test" to make the
determination that light- and medium-duty local delivery contrac-
tors for Dynamex had been misclassified as independent contractors.
They'd been converted from W-2 employees a decade earlier.
The test could have far-reaching
consequences because, applied
elsewhere, it could change how
the Internal Revenue Service and
state tax and labor departments
look at self-employed owner-
operators leased to carriers. Depending on how subsequent judicial
and legislative actions play out, it could become much harder to work
as an independent-contractor trucker in California, especially in port
applications, and perhaps elsewhere.
Under the ABC test, three conditions must be met to properly
classify independent contractors. For trucking, it's part B that's most
problematic, requiring an independent contractor to be in a field of
work outside the usual course of the carrier's business.
Applied broadly, any trucking entity that employs drivers in com-
pany trucks but also maintains a division of independent contractors
could be open to legal action for misclassifying its owner-operators.
As in cases such as Dynamex, they could be subject to employee-
focused wage and hour rules.
California labor laws require that employers provide a 30-minute
meal break every five hours at work and a paid 15-minute rest break
for every four hours of work time.
Few trucking companies before recent history have bothered with
such regulations, given the nature of the business. However, "every
state has them" in some form, says Todd Spencer, president of the
Owner-Operator Independent Drivers Association.
California ports are a battleground
over predatory truck lease-purchase
programs, which have helped prompt
union organizing efforts and pushback
from labor and the state.
The next battle in what some
view as a West Coast war on
owner-operators has nothing
to do with truck emissions.
Instead, California's labor
law developments, predatory
lease-purchase practices and
aggressive union organizing
are making it increasingly
difficult to operate, let alone
thrive, as an independent
contractor.
Courtesy
of
Long
Beach
UNDERMINING THE
OWNER-OPERATOR
BY TODD DILLS
CALIFORNIA'S
INDEPENDENT
CONTRACTOR CRISIS